The impeachment of US president Donald Trump “would blow a hole in the stockmarket”, claims Jack Welch, former chief executive of General Electric. Two months ago, Welch “was much more bullish about the market”. Now, the political uncertainty caused by various scandals in the administration is causing business leaders to reconsider their investment plans.
Of course, Trump has to shoulder a great deal of the blame for this. Welch gives Trump “a D-minus for communication and management, and that’s being a generous grader”. One problem is that Trump’s family business background means that “he has no experience of running a bureaucracy”. This has resulted in “rookie mistakes” such as his decision to fire ex-FBI head James Comey without warning. Meanwhile, he has retained “people who leak and gossip about him behind his back”. He needs to “get a good team together” and make sure his communications people “get behind” his mission.
That said, not everything has gone badly. The president “deserves an A for his appointments”, and “for boosting consumer confidence and the morale of the business community”. His election has created “an air of confidence” in both the market and the wider economy that hasn’t been seen for some time. If Trump turns things around, or at least avoids further crises, then growth could improve further as “we have the underpinnings of a great economy”. Indeed, Welch reckons growth could accelerate to 3%-3.5% inside 18 months. Investors and the public expect Trump’s agenda of tax cuts and infrastructure spending “to be delivered”.